The company founder takes his entire staff and their families on a yearly holiday to ski in Flagstaff or tour Kartchner Caverns.

Senior engineers receive a monthlong summer sabbatical.

The company pays above its industry average.

No, the dot-com days are not back. At Performance Software Corp., founder and Chief Executive Officer Tim Bigelow thinks putting his employees first is the best way to get sophisticated software projects delivered on time and on budget to big customers like Honeywell International and Motorola Inc.

Performance is the mission as well as the name.

"We're going to make software development projects perform," he said.

And the philosophy seems to be working.

Performance Software ranked No. 88 on this year's Inc. 500 list of the fastest-growing private companies in the United States, with revenue growth of 1,625 percent from 1998 to 2002. It was the company's first appearance on the prestigious list.

Starting his own company was a goal 11 years in the making, Bigelow said, from his undergraduate and business school days through his three years at a start-up in his native Minnesota. That's where he noticed the inefficiencies of large software-development contracts.

"I just knew there had to be a better way," he said. "And I saw how the industry was changing. It wasn't allowable anymore to run over budget and over schedule."

He left Minnesota for Arizona's bigger software industry and started Performance. The company's first project was working on communications software for a large avionics company.

Then, as now, Performance will take a piece of a large software development project and partner with the larger company's developers to get it done. It specializes in "mission-critical," heavily tested software that must work, as opposed to simpler code designed for non-critical uses on personal computers.

It delivers projects on time by keeping close track of how they're going and what any problems are, Bigelow said.

It completes projects on budget by accurately estimating how many hours they will take, Chief Technology Officer Jamie Breese said.

The firm also is working on programming tools and other techniques that will help it stay efficient and keep its costs competitive with those of software houses in India and other offshore locations, Bigelow and Breese said.

Hiring is rigorous, Bigelow said. The company looks for employees who are not just in the top 10 percent technically but who also are good at teamwork and customer service. It's an unusual combination that limited the company's growth early on, he acknowledges.

Performance expects to hire more software engineers in the next year as demand for its services grows.

The company is targeting 90 prospective client companies from Boston to Los Angeles in the hope of generating 30 percent revenue growth next year.